Hogan’s adviser victim of ‘charade’

Paul Hogan
’s former financial adviser, Anthony Stewart, was the victim of a “two-pronged attack" by the Australian Taxation Office, his lawyers have argued.

In the Central Local Court yesterday, Mr Stewart’s lawyers argued a compulsory examination notice served on him by the ATO was invalid because any information would be passed to the Australian Crime Commission.

Around the time the examination notice was issued another section of the serious non-compliance area of the ATO was trying to prevent Mr Stewart from claiming documents they had received from the ACC should be kept confidential, it emerged yesterday.

Michael Abbott QC, for Mr Stewart, asked senior tax officer Prashant Singh if issuing the examination notice was “just a charade" for uncovering information that could be used to prosecute Mr Stewart and two clients, Mr Hogan and former artistic collaborator
John Cornell
.

The trio were identified as subjects in the multi-agency international tax probe Project Wickenby in 2005, after documents seized from controversial offshore tax adviser Phillip Egglishaw included notes of meetings with Mr Stewart.

Mr Hogan, Mr Cornell and Mr Stewart have fought the authorities every step of the way, and are embroiled in two court cases against the ATO and one against the ACC. No criminal charges have been laid, but a decision is expected after a legal privilege dispute is resolved with the ACC next month.

In court yesterday, Mr Singh agreed “tens of thousands of documents" relating to the continuing criminal investigation into the trio had been received by the ATO from the ACC during 2008 and 2009.

Mr Abbott asked Mr Singh whether the examination notice was issued so that information received from the ACC would become “admissible" and could be used by the ATO. Mr Singh denied this.

Related Quotes

Company Profile

Mr Stewart had already been examined by the ACC for 8½ days, the transcript of which the ATO had in its possession when it issued another examination notice.

In 2006, the ACC commenced a special purpose investigation into the tax affairs of Mr Hogan, Mr Cornell and Mr Stewart called Operation Youghal.

But during this time the ATO also launched an audit investigation into the trio and associated companies, and served the three with amended tax assessments.

The second examination notice was issued by the ATO in 2009 even though the information had not been asked for informally, contrary to ATO guidelines.

Yesterday in court, Mr Abbott quoted from the ATO’s submission to issue the examination notice and said it was issued so that Mr Stewart could not refuse to answer questions on the ground of self-incrimination, could not claim accountants’ privilege, and was “unable to raise any claim that he was bound by some form of confidentiality agreement" with either Mr Hogan or Mr Cornell. Mr Abbott suggested Mr Singh, who signed off on the tax examination notice, had “rejected the notion of an informal approach and wished to extract information through coercive powers". Mr Singh denied this.

In Court on Monday, Mr Abbott argued the tax examination notice had been issued for an improper purpose because it would include “doing the ACC’s work". The ATO has denied the examination notice was not valid and yesterday questioned the relevance of many of Mr Abbott’s questions about the tax affairs of Mr Hogan and Mr Cornell.

Magistrate Peter Miszalski told the parties: “The matter before the court is Mr Stewart; I am only interested in Mr Stewart.

“These proceedings are not going to be railroaded under any circumstances," he said.